So Where Is The Stock Market Headed In 2011?
That is a very good question considering the huge run up on the market last year.
Sometimes huge gains can be scary because a massive sell off correction can occur.
But is this really about to happen? With 2010 being so kind to investors, just what does the future hold for us in 2011? I think at this point it is safe to say, one should remain quite cautious with the global stock markets.
With such a run up last year in 2010, with prices so high, it is becoming increasingly obvious there are a limited amount of bargains lying around.
In fact if you look at some of the strongest performers, if you look at their future earnings, a lot of them are actually overvalued at the moment.
This would suggest that the market in 2011 could face a slight chance of some sort of sell off.
It is a tough call but.
Even though the economy seems to be improving, people are losing their jobs, mortgages are still defaulting and unemployment is still sky high.
So the economy is still in a fragile state.
It is highly likely that austerity measures will be carried out in many countries this year.
IF that was to happen, recession is not likely, however we are still a long way from seeing a full recovery that the government keeps talking about.
It is best to be in cash as an investor right now.
To save the money that was made last year, and not risk losing it quickly, in case of a sudden large correction this year.
Then just take stock and analyze what the next smartest move shall be as we watch what the economy does and the government's action to either nurture it or let it dwindle.
Sometimes huge gains can be scary because a massive sell off correction can occur.
But is this really about to happen? With 2010 being so kind to investors, just what does the future hold for us in 2011? I think at this point it is safe to say, one should remain quite cautious with the global stock markets.
With such a run up last year in 2010, with prices so high, it is becoming increasingly obvious there are a limited amount of bargains lying around.
In fact if you look at some of the strongest performers, if you look at their future earnings, a lot of them are actually overvalued at the moment.
This would suggest that the market in 2011 could face a slight chance of some sort of sell off.
It is a tough call but.
Even though the economy seems to be improving, people are losing their jobs, mortgages are still defaulting and unemployment is still sky high.
So the economy is still in a fragile state.
It is highly likely that austerity measures will be carried out in many countries this year.
IF that was to happen, recession is not likely, however we are still a long way from seeing a full recovery that the government keeps talking about.
It is best to be in cash as an investor right now.
To save the money that was made last year, and not risk losing it quickly, in case of a sudden large correction this year.
Then just take stock and analyze what the next smartest move shall be as we watch what the economy does and the government's action to either nurture it or let it dwindle.
